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Sixth Substitute H.B. 136
This document includes Senate 3rd Reading Floor Amendments incorporated into the bill
on Tue, Mar 2, 2004 at 11:45 AM by rday. -->
Senator Thomas V. Hatch proposes the following substitute bill:
1
ELECTRONIC FILING OF PRELIMINARY
2
LIEN DOCUMENTS
3
2004 GENERAL SESSION
4
STATE OF UTAH
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Sponsor: Michael T. Morley
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7
LONG TITLE
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General Description:
9
This bill modifies the Mechanics' Lien statute and enacts provisions for on-line filing of
10
notices of commencement, preliminary notices, and notices of completion.
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Highlighted Provisions:
12
This bill:
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. addresses preliminary notice requirements;
14
. addresses notice of claim requirements;
15
. requires the Division of Occupational and Professional Licensing to contract for the
16
creation and maintenance of a construction notice registry;
17
. requires the notice registry to be accessible for filing and reviewing notices of
18
commencement, preliminary notices, and notices of completion;
19
. provides for alternative filing;
20
. requires that electronic notification and hard-copy printing of electronic receipts be
21
provided;
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. requires the division to establish by rule the fees for filing;
23
. creates requirements for filing notices;
24
. requires the assignment to each construction project a unique project number which
25
identifies each construction project;
26
. provides requirements for the content of a notice of commencement;
27
. provides penalties for failure to file notices in a timely manner;
28
. provides penalties for abuse of the construction notice register;
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. provides that the state is not liable;
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. provides that construction notice does not impart notice for specified purposes;
31
. addresses applicability of sections on the basis of when a construction project is
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commenced;
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. requires a sunset review by July 1, 2008; and
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. makes technical changes.
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Monies Appropriated in this Bill:
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None
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Other Special Clauses:
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This bill provides a severability clause.
39
This bill provides an effective date.
40
This bill provides a coordination clause.
41
Utah Code Sections Affected:
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AMENDS:
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14-1-20, as enacted by Chapter 271, Laws of Utah 1989
44
14-2-5, as enacted by Chapter 271, Laws of Utah 1989
45
38-1-7, as last amended by Chapter 223, Laws of Utah 1999
46
63-56-38.1, as enacted by Chapter 271, Laws of Utah 1989
47
ENACTS:
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38-1-30, Utah Code Annotated 1953
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38-1-31, Utah Code Annotated 1953
50
38-1-32, Utah Code Annotated 1953
51
38-1-33, Utah Code Annotated 1953
52
38-1-34, Utah Code Annotated 1953
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38-1-35, Utah Code Annotated 1953
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38-1-36, Utah Code Annotated 1953
55
38-1-37, Utah Code Annotated 1953
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63-55-238, Utah Code Annotated 1953
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REPEALS AND REENACTS:
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38-1-27, as last amended by Chapter 229, Laws of Utah 2001
59
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Be it enacted by the Legislature of the state of Utah:
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Section 1.
Section
14-1-20
is amended to read:
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14-1-20. Preliminary notice requirement.
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Except [persons who are in privity of contract with a payment bond principal or except]
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for persons performing labor for wages, any person furnishing labor, service, equipment, or
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material for which a payment bond claim may be made under this chapter shall provide
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preliminary notice to the [payment bond principal] designated agent as prescribed by Section
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[
38-1-27
]
38-1-32
. Any person who fails to provide this preliminary notice may not make a
68
payment bond claim under this chapter. The preliminary notice must be provided prior to
69
commencement of any action on the payment bond.
70
Section 2.
Section
14-2-5
is amended to read:
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14-2-5. Preliminary notice requirement.
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Except [subcontractors who are in privity of contract with a payment bond principal or
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except] for persons performing labor for wages, any person furnishing labor, service,
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equipment, or material for which a payment bond claim may be made under this chapter shall
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provide preliminary notice to the [payment bond principal] designated agent as prescribed by
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Section [
38-1-27
]
38-1-32
. Any person who fails to provide this preliminary notice may not
77
make a payment bond claim under this chapter. The preliminary notice must be provided prior
78
to commencement of any action on the payment bond.
79
Section 3.
Section
38-1-7
is amended to read:
80
38-1-7. Notice of claim -- Contents -- Recording -- Service on owner of property.
81
(1) [A] Except as modified in Section
38-1-27
, a person claiming benefits under this
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chapter shall file for record with the county recorder of the county in which the property, or
83
some part of the property, is situated, a written notice to hold and claim a lien within 90 days
84
from the date:
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(a) the person last performed labor or service or last furnished equipment or material
86
on a project or improvement for a residence as defined in Section
38-11-102
; or
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(b) of final completion of an original contract not involving a residence as defined in
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Section
38-11-102
.
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(2) The notice required by Subsection (1) shall contain a statement setting forth:
90
(a) the name of the reputed owner if known or, if not known, the name of the record
91
owner;
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(b) the name of the person by whom the lien claimant was employed or to whom the
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lien claimant furnished the equipment or material;
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(c) the time when the first and last labor or service was performed or the first and last
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equipment or material was furnished;
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(d) a description of the property, sufficient for identification;
97
(e) the name, current address, and current phone number of the lien claimant;
98
(f) the signature of the lien claimant or the lien claimant's authorized agent;
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(g) an acknowledgment or certificate as required under Title 57, Chapter 3, Recording
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of Documents; and
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(h) if the lien is on an owner-occupied residence, as defined in Section
38-11-102
, a
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statement describing what steps an owner, as defined in Section
38-11-102
, may take to require
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a lien claimant to remove the lien in accordance with Section
38-11-107
.
104
(3) Notwithstanding Subsection (2), an acknowledgment or certificate is not required
105
for any notice filed after April 29, 1985, and before April 24, 1989.
106
(4) (a) Within 30 days after filing the notice of lien, the lien claimant shall deliver or
107
mail by certified mail a copy of the notice of lien to:
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(i) the reputed owner of the real property; or
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(ii) the record owner of the real property.
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(b) If the record owner's current address is not readily available to the lien claimant, the
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copy of the claim may be mailed to the last-known address of the record owner, using the
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names and addresses appearing on the last completed real property assessment rolls of the
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county where the affected property is located.
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(c) Failure to deliver or mail the notice of lien to the reputed owner or record owner
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precludes the lien claimant from an award of costs and attorneys' fees against the reputed
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owner or record owner in an action to enforce the lien.
117
(5) The Division of Occupational and Professional Licensing shall make rules
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governing the form of the statement required under Subsection (2)(h).
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Section 4.
Section
38-1-27
is repealed and reenacted to read:
120
38-1-27. Construction notice registry -- Form and contents of notice of
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commencement, preliminary notice, and notice of completion.
122
(1) As used in this section and Sections
38-1-30
through
38-1-37
:
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(a) "Database" means the Construction Notice Registry Database created in this
124
section.
125
(b) (i) "Designated agent" means the third party the Division of Occupational and
126
Professional Licensing contracts with to create and maintain the Construction Notice Registry
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Database.
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(ii) The designated agent is not an agency, instrumentality, or a political subdivision of
129
the state.
130
(c) "Division" means the Division of Occupational and Professional Licensing.
131
(d) "Program" means the Construction Notice Registry Database Program created in
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this section.
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(2) Subject to receiving adequate funding through a legislative appropriation and
134
contracting with an approved third party vendor who meets the requirements of Sections
135
38-1-30
through
38-1-37
, there is created the Construction Notice Registry Database Program
136
which shall:
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(a) assist in protecting public health, safety, and welfare and promote a fair working
138
environment;
139
(b) be overseen by the division with the assistance of the designated agent;
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(c) provide a central repository for notices of commencement, preliminary notices, and
141
notices of completion filed in connection with all privately owned construction projects as well
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as all state and local government owned construction projects throughout Utah;
143
(d) be accessible for filing and review of notices of commencement, preliminary
144
notices, and notices of completion via the program Internet website;
145
(e) accommodate electronic filing of such notices as well as provide for alternate filing
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by U.S. mail, telefax, telephone, or any other alternate method as provided by rule made by the
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division in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act;
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(f) provide electronic notification for up to three e-mail addresses for each interested
149
person or company who requests notice from the construction notice registry as well as provide
150
alternate means of notification for those persons who make alternate filings, including U.S.
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mail, telefax, or any other method as prescribed by rule made by the division in accordance
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with Title 63, Chapter 46a, Utah Administrative Rulemaking Act; and
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(g) provide hard-copy printing of electronic receipts for individual filings evidencing
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the date and time of individual filings as well as the content of individual filings.
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(3) Persons interested in a construction project may request notice of filings related to
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the project. The database shall be indexed by owner name, original contractor name, project
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name, project address, parcel number, project number, and any other identifier that the division
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considers reasonably appropriate and established by rule, made in accordance with Title 63,
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Chapter 46a, Utah Administrative Rulemaking Act.
160
(4) (a) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act,
161
the division shall establish by rule the filing fees for notices of commencement, preliminary
162
notices, notices of completion, and requests for notice, which fees may not exceed the amount
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reasonably necessary to create and maintain the database.
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(b) The fees established by the division may vary by method of filing if one form of
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filing is more costly than other forms of filing.
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Section 5.
Section
38-1-30
is enacted to read:
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38-1-30. Third party contract -- Designated agent.
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(1) The division shall contract in accordance with Title 63, Chapter 56, Utah
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Procurement Code, with a third party to establish and maintain the database for the purposes
170
established under this section, Section
38-1-27
, and Sections
38-1-31
through
38-1-37
.
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(2) (a) The third party under contract under this section is the division's designated
172
agent, and shall develop and maintain a database from the information provided by:
173
(i) local government entities issuing building permits;
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(ii) original contractors;
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(iii) subcontractors; and
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(iv) other interested persons.
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(b) The division and the designated agent shall design, develop, and test the database
178
for full implementation on May 1, 2005.
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(3) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
180
division shall make rules and develop procedures for:
181
(a) the division to oversee and enforce this section, Section
38-1-27
, and Sections
182
38-1-31
through
38-1-37
; and
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(b) the designated agent to administer this section, Section
38-1-27
, and Sections
184
38-1-31
through
38-1-37
.
185
(4) (a) The designated agent shall archive computer data files at least semiannually for
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auditing purposes.
187
(b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
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division shall make rules to allow the designated agent, unless requested otherwise by an
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interested party for a particular project, to periodically archive and purge completed or inactive
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projects from the database:
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(i) no earlier than one year after the day on which a notice of commencement is filed
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for a particular project; or
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(ii) if no notice of commencement is filed, no earlier than two years after the last filing
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activity for a particular project.
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(c) The division may audit the designated agent's administration of the database as
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often as the division considers necessary.
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(5) The designated agent shall carry errors and omissions insurance in the amounts
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established by rule made by the division in accordance with Title 63, Chapter 46a, Utah
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Administrative Rulemaking Act.
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Section 6.
Section
38-1-31
is enacted to read:
201
38-1-31. Building permit -- Construction -- Notice registry -- Notice of
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commencement of work.
203
(1) (a) For a construction project where a building permit is issued, within 15 days after
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the issuance of the building permit, the local government entity issuing that building permit
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shall input the data and transmit the building permit information to the database electronically
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via the Internet or computer modem or by any other means and such information shall form the
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basis of a notice of commencement.
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(b) For a construction project where a building permit is not issued, within 15 days
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after commencement of physical construction work at the project site, the original contractor
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shall file a notice of commencement with the database.
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(c) An owner of construction, a lender, surety, or other interested party may file a
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notice of commencement with the designated agent within the prescribed time set forth in
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Subsection (1)(a).
214
(d) If duplicate notices of commencement are filed, they shall be combined into one
215
notice for each project. The designated agent shall assign each construction project a unique
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project number which identifies each construction project and can be associated with all
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notices of commencement, preliminary notices, and notices of completion.
218
(e) A notice of commencement is effective as to all work, materials, and equipment
219
furnished to the construction project after the filing of the notice of commencement. A notice
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of commencement is effective only as to the work, materials, or equipment furnished to the
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construction project that is provided subsequent to the filing of the notice of commencement.
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(2) The content of a notice of commencement shall include the following if available
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on a building permit:
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(a) the name and address of the owner of the project or improvement;
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(b) the name and address of the:
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(i) original contractor; and
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(ii) surety providing any payment bond for the project or improvement, or if none
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exists, a statement that a payment bond was not required for the work being performed;
229
(c) (i) the project address if the project can be reasonably identified by an address; or
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(ii) the name and general description of the location of the project if the project cannot
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be reasonably identified by an address;
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(d) a general description of the project;
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(e) the parcel number of the real property upon which the project is to be constructed if
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the project is subject to mechanics' liens; and
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(f) a legal description of the property on which the project is located if the project is
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subject to mechanics' liens.
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(3) Failure to file any notice of commencement for a construction project suspends the
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operation of:
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(a) the preliminary notice provisions of Section
38-1-32
; and
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(b) the notice of completion provisions of Section
38-1-33
.
241
(4) Electronic notice of the filing of a notice of commencement or alternate notice as
242
prescribed in Subsection (1), shall be provided to:
243
(a) all persons who have filed notices of commencement for the project; and
244
(b) all interested parties who have requested such notice for the project.
245
(5) The burden is upon any person seeking to enforce the notice of commencement to
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prove that the notice of commencement is filed timely and meets all of the requirements in this
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section.
248
(6) At the time a building permit is obtained, each original contractor shall
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conspicuously post at the project site a copy of each building permit obtained for the project
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improvement.
251
Section 7.
Section
38-1-32
is enacted to read:
252
38-1-32. Preliminary notice -- Subcontractor or supplier.
253
(1) (a) Within 20 days after commencement of its own work or the commencement of
254
furnishing materials or equipment to a construction project, a subcontractor or supplier shall
255
file a preliminary notice with the construction notice registry. A preliminary notice filed within
256
the 20-day period is effective as to all work, materials, and equipment furnished to the
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construction project.
258
(b) If a subcontractor or supplier files a preliminary notice after the 20-day period
259
prescribed by Subsection (1)(a), the preliminary notice becomes effective as of five days after
260
the filing of the preliminary notice.
261
(c) Failure to file a preliminary notice within the 20-day period required by Subsection
262
(1)(a) precludes a subcontractor or supplier from filing any claim for compensation earned for
263
performance of work or supply of materials or equipment furnished to the construction project
264
before the expiration of five days after the filing of a preliminary notice, except as against the
265
person with whom the subcontractor or supplier contracted S [
; provided, however, that nothing in
266
this Subsection (1) shall prevent a subcontractor or supplier from seeking compensation under
267
Section
38-11-101
] s
.
268
(d) The preliminary notice must be filed before a notice of lien may be filed with the
269
county recorder pursuant to Section
38-1-7
. The content of a preliminary notice shall include
270
the following:
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(i) the name, address, and telephone number of the person furnishing the labor, service,
272
equipment, or material;
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(ii) the name and address of the person who contracted with the claimant for the
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furnishing of the labor, service, equipment, or material;
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(iii) the name of the record or reputed owner of the project or improvement;
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(iv) the name of the original contractor under which the claimant is performing or will
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perform its work; and
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(v) the address of the project or improvement or a description of the location of the
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project or improvement.
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(2) (a) Electronic notification of the filing of a preliminary notice or alternate notice as
281
prescribed in Subsection (1), shall be provided to:
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(i) the person filing the preliminary notice;
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(ii) each person that filed a notice of commencement for the project; and
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(iii) all interested parties who have requested such notice for the project.
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(b) The burden is upon the person filing the preliminary notice to prove that the
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preliminary notice is filed timely and substantially meets all of the requirements of this section.
287
(c) Subject to Subsection (1)(d), a person required by this section to give preliminary
288
notice is only required to give one notice for each project or improvement, which may include
289
an entire structure or a scheme of improvements.
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(d) If the labor, service, equipment, or material is furnished pursuant to contracts under
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more than one original contract, the notice requirements must be met with respect to the labor,
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service, equipment, or materials furnished under each original contract.
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(3) (a) If a construction project owner, original contractor, subcontractor, or other
294
interested person believes that a preliminary notice has been filed erroneously, that owner,
295
original contractor, subcontractor, or other interested person can request evidence establishing
296
the validity of the preliminary notice.
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(b) Within ten days after the request described in Subsection (3)(a), the person or entity
298
that filed the preliminary notice shall provide the requesting person or entity proof that the
299
preliminary notice is valid.
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(c) If the person or entity that filed the preliminary notice cannot provide proof of the
301
validity of the preliminary notice, that person or entity shall immediately remove the
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preliminary notice from the database.
303
Section 8.
Section
38-1-33
is enacted to read:
304
38-1-33. Notice of completion.
305
(1) (a) Upon final completion of a construction project, an owner of a construction
306
project, an original contractor, a lender that has provided financing for the construction project,
307
or surety that has provided bonding for the construction project, may file a notice of completion
308
with the database. Final completion, for purposes of this Subsection (1), shall mean:
309
(i) if as a result of work performed under the original contract a permanent certificate
310
of occupancy is required for such work, the date of issuance of a permanent certificate of
311
occupancy by the local government entity having jurisdiction over the construction project;
312
(ii) if no certificate of occupancy is required by the local government entity having
313
jurisdiction over the construction project, but as a result of the work performed under the
314
original contract an inspection is required for such work, the date of the final inspection for
315
such work by the local government entity having jurisdiction over the construction project; or
316
(iii) if with regard to the work performed under the original contract no certificate of
317
occupancy and no final inspection are required by the local government entity having
318
jurisdiction over the construction project, the date on which there remains no substantial work
319
to be completed to finish such work on the original contract.
320
(b) Notwithstanding Section
38-1-2
, where a subcontractor performs substantial work
321
after the applicable dates established by Subsections (1)(a)(i) and (ii), that subcontractor's
322
subcontract shall be considered an original contract for the sole purpose of determining:
323
(i) the subcontractor's time frame to file a notice to hold and claim a lien under
324
Subsection
38-1-7
(1); and
325
(ii) the original contractor's time frame to file a notice to hold and claim a lien under
326
Subsection
38-1-7
(1) for that subcontractor's work.
327
(c) For purposes of this section, the term "substantial work" does not include:
328
(i) repair work;
329
(ii) warranty work; or
330
(iii) work for which the project owner is not holding payment to ensure completion of
331
that work.
332
(d) (i) Electronic notification of the filing of a notice of completion or alternate notice
333
as prescribed in Subsection (1)(a), shall be provided to:
334
(A) each person that filed a notice of commencement for the project;
335
(B) each person that filed preliminary notice for the project; and
336
(C) all interested parties who have requested notice for the project.
337
(ii) Upon the filing of a notice of completion, the time periods for filing preliminary
338
notices stated in Section
38-1-27
are modified such that all preliminary notices shall be filed
339
subsequent to the notice of completion and shall be filed within ten days from the day on which
340
the notice of completion is filed.
341
(e) A subcontract that is considered an original contract for purposes of this section
342
shall not create a requirement for an additional preliminary notice if a preliminary notice has
343
already been given for materials and labor furnished to the subcontractor who performs
344
substantial work.
345
(2) (a) If a construction project owner, original contractor, subcontractor, or other
346
interested person believes that a notice of completion has been filed erroneously, that owner,
347
original contractor, subcontractor, or other interested person can request evidence establishing
348
the validity of the notice of completion.
349
(b) Within ten days after the request described in Subsection (2)(a), the person that
350
filed the notice of completion shall provide the requesting person proof that the notice of
351
completion is valid.
352
(c) If the person that filed the notice of completion cannot provide proof of the validity
353
of the notice of completion, that person shall immediately remove the notice of completion
354
from the database.
355
Section 9.
Section
38-1-34
is enacted to read:
356
38-1-34. Abuse of database -- Penalty.
357
(1) A person abuses the database if that person records a notice in the database:
358
(a) without a good faith basis for doing so;
359
(b) with the intent to exact more than is due from the project owner or any other
360
interested party; or
361
(c) to procure an unjustified advantage or benefit.
362
(2) A person who violates Subsection (1) is liable to the owner of the construction
363
project, an original contractor, a subcontractor, or any interested party who is affected by the
364
notice for twice the amount of the actual damages incurred by such party or $2,000, whichever
365
is greater.
366
Section 10.
Section
38-1-35
is enacted to read:
367
38-1-35. State not liable.
368
(1) The state and the state's agencies, instrumentalities, and political subdivisions are
369
not liable for any errors in receiving, recording, maintaining, and reporting any notices or
370
information in the database.
371
(2) The designated agent shall:
372
(a) not be entitled to the liability limitations provided by this section; and
373
(b) maintain a liability insurance policy in an amount set by rule.
374
Section 11.
Section
38-1-36
is enacted to read:
375
38-1-36. Construction notice does not impart notice.
376
The filing of a document in the database is not intended to give notice to all persons of
377
the content of the document within the meaning of Section
57-3-102
and does not constitute
378
constructive notice of matters relating to real property to purchasers for value and without
379
knowledge.
380
Section 12.
Section
38-1-37
is enacted to read:
381
38-1-37. Application of Section 38-1-27 and Sections 38-1-30 through 38-1-36.
382
(1) Section
38-1-27
and Sections
38-1-30
through
38-1-36
in effect as of May 1, 2005
383
shall apply to construction projects commenced on or after May 1, 2005.
384
(2) A construction project commenced before May 1, 2005 is subject to the provisions
385
of this chapter in effect prior to May 1, 2005.
386
Section 13.
Section
63-55-238
is enacted to read:
387
63-55-238. Repeal dates, Title 38.
388
Section
38-1-27
and Sections
38-1-30
through
38-1-37
are repealed July 1, 2008.
389
Section 14.
Section
63-56-38.1
is amended to read:
390
63-56-38.1. Preliminary notice requirement.
391
Except [subcontractors who are in privity of contract with a payment bond principal or
392
except] for persons performing labor for wages, any person furnishing labor, service,
393
equipment, or material for which a payment bond claim may be made under this chapter shall
394
provide preliminary notice to the [payment bond principal] designated agent as prescribed by
395
Section [
38-1-27
]
38-1-32
. Any person who fails to provide this preliminary notice may not
396
make a payment bond claim under this chapter. The preliminary notice must be provided prior
397
to commencement of any action on the payment bond.
398
Section 15. Severability clause.
399
If any provision of this chapter is held invalid or unconstitutional by a court of
400
competent jurisdiction, the invalidity shall not affect the other provisions of this chapter which
401
can be given effect without the invalid or unconstitutional provision.
402
Section 16. Effective date.
403
(1) Except for Section
38-1-30
, this bill takes effect on May 1, 2005.
404
(2) If approved by two-thirds of all the members elected to each house, Section
38-1-30
405
takes effect upon approval by the governor, or the day following the constitutional time limit of
406
Utah Constitution Article VII, Section 8, without the governor's signature, or in the case of a
407
veto, the date of veto override.
408
Section 17. Coordinating H.B. 136 with H.B. 20.
409
It is the intent of the Legislature that if this H.B. 136 and H.B. 20, Construction
410
Bonding Statutes, both pass that the Office of Legislative Research and General Counsel in
411
preparing the Utah Code database for publication merge the amendments of these bills as
412
follows:
413
(1) Section
14-1-20
, effective May 1, 2005, shall read:
414
" 14-1-20. Preliminary notice requirement.
415
[Except persons who are in privity of contract with a payment bond principal or except
416
for persons performing labor for wages, any]
417
(1) Any person furnishing labor, service, equipment, or material for which a payment
418
bond claim may be made under this chapter shall provide preliminary notice to the [payment
419
bond principal] designated agent as prescribed by Section [
38-1-27
.]
38-1-32
, except that this
420
section does not apply:
421
(a) to a person performing labor for wages; or
422
(b) if a notice of commencement is not filed as prescribed in Section
38-1-31
for the
423
project or improvement for which labor, service, equipment, or material is furnished.
424
(2) Any person who fails to provide [this] the preliminary notice required by
425
Subsection (1) may not make a payment bond claim under this chapter.
426
(3) The preliminary notice required by Subsection (1) must be provided prior to
427
commencement of any action on the payment bond."
428
(2) Section
14-2-5
, effective May 1, 2005, shall read:
429
" 14-2-5. Preliminary notice requirement.
430
[Except subcontractors who are in privity of contract with a payment bond principal or
431
except for persons performing labor for wages, any]
432
(1) Any person furnishing labor, service, equipment, or material for which a payment
433
bond claim may be made under this chapter shall provide preliminary notice to the [payment
434
bond principal] designated agent as prescribed by Section [
38-1-27
.]
38-1-32
, except that this
435
section does not apply:
436
(a) to a person performing labor for wages; or
437
(b) if a notice of commencement is not filed as prescribed in Section
38-1-31
for the
438
project or improvement for which labor, service, equipment, or material is furnished.
439
(2) Any person who fails to provide [this] the preliminary notice required by
440
Subsection (1) may not make a payment bond claim under this chapter.
441
(3) The preliminary notice required by Subsection (1) must be provided prior to
442
commencement of any action on the payment bond."
443
(3) Section
63-56-38.1
, effective May 1, 2005, shall read:
444
" 63-56-38.1. Preliminary notice requirement.
445
[Except subcontractors who are in privity of contract with a payment bond principal or
446
except for persons performing labor for wages, any]
447
(1) Any person furnishing labor, service, equipment, or material for which a payment
448
bond claim may be made under this chapter shall provide preliminary notice to the [payment
449
bond principal] designated agent as prescribed by Section [
38-1-27
.]
38-1-32
, except that this
450
section does not apply:
451
(a) to a person performing labor for wages; or
452
(b) if a notice of commencement is not filed as prescribed in Section
38-1-31
for the
453
project or improvement for which labor, service, equipment, or material is furnished.
454
(2) Any person who fails to provide [this] the preliminary notice required by
455
Subsection (1) may not make a payment bond claim under this chapter.
456
(3) The preliminary notice required by Subsection (1) must be provided prior to
457
commencement of any action on the payment bond."
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